That cheering you heard this week came from Wall Street. The stock market is once again on the upswing with the Dow Jones Industrial Average hitting a four-year high. But the stock market is a much different place than it used to be and a lot of small investors are sitting out this rally.

NPR's Jim Zarroli reports.

JIM ZARROLI, BYLINE: Andre Cortez is a chauffeur in Los Angeles, and over the years he's managed to save a little money. Right now, the money is sitting in a savings account where it's earning next to nothing. Standing by his car waiting for a passenger downtown, Cortez says he thinks about buying stocks, but hesitates.

ANDRE CORTEZ: I read some books about the stock market and stuff, and I don't feel like I understand it enough to really get involved in it. And then I watched the movie called "Inside Job." Have you seen that movie? And then that totally scared me away from the stock market.

ZARROLI: "Inside Job" was a popular documentary about the 2008 financial crisis. Since the crisis erupted, there's been unsurprisingly a shift in Americans' attitude toward the stock market, and its reflected in where they put their money. According to the Investment Company Institute, 46 percent of U.S. households had money in stocks or stock funds last year. That's down from 59 percent in 2001.

David Santschi is with the research firm TrimTabs, which tracks money flows. He says, this year, the movement of funds into stocks has pretty much slowed to a trickle.

DAVID SANTSCHI: That's really not where the money has been flowing this year. The real money has been flowing right under their mattresses, so to speak.

ZARROLI: Money is still going into the stock market, that's partly because the Federal Reserve has kept interest rates so low. And many big investors view stocks as a kind of least worst place to park their money. But a lot of the small investors, who once populated online forums and dabbled in day trading, have pretty much checked out. That's partly because unemployment is up and people have less money to invest. But that's only part of it.

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UNIDENTIFIED MAN: I mean, it is classic capitulation. There is fear in this market. You can take a look at what has happened with the (unintelligible) act absolutely exploding today...

ZARROLI: Incidence like the 2010 flash crash and the recent Knight Capital fiasco caused stock prices to gyrate dramatically in a matter of the minutes. And they made the market seem a lot more volatile and dangerous, if not rigged against amateurs.

Former Treasury Department official Neel Kashkari, who's now with the bond find PIMCO, says people simply got burned out by the financial crisis and all that followed it.

NEEL KASHKARI: This has now been going on a long time and people are getting, I think, tired of it and are scared. And are saying, you know what? I just don't want the downside. I work too hard for my savings and I don't want the downside. And so, I'm going to sit on the sidelines until this passes.

ZARROLI: They're people like Dennis Yun, a lawyer in Los Angeles. He's got some money in bonds. But he says he's too risk averse for stocks.

DENNIS YUN: What from what I understand, there's going to be another recession next year - a bigger one - based on what the experts are predicting. So there will probably be another downturn for at least another several years. So I'd probably rather have cash than stock.

ZARROLI: Such sentiments are understandable, says Professor Sung Won Sohn of California State University, Channel Islands. But Sohn says investors like these are probably over-reacting. He says people have gone from having too much faith in the markets to having too little.

SUNG WON SOHN: But the fact of the matter is that, you know, the bulk of our economy is represented in the stock market. There are very good companies. And as long as you believe in America, the American economy in the long run, there will be many companies which will do reasonably well.

ZARROLI: In fact, a lot of U.S. companies continue to make huge profits and they will be well-positioned to grow if the economy takes off. But for now, at least, that's a message a lot of small investors no longer want to hear.

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